Jet Support Services, Inc. (JSSI) is adding Tip-to-Tail coverage for another relatively new aircraft, the Gulfstream G280 super midsized business jet, as the Chicago-based hourly cost maintenance program provider looks to substantially grow its entire aircraft business.
JSSI, which has helped pioneer the hourly-cost maintenance program in the business aviation community, has built its business around engine programs, with 5,000 engines enrolled. But Neil Book, president and CEO, says the firm is “aggressively moving into airframes” since it currently has just a few hundred in its programs.
The G280 is among a little more than a handful of aircraft to recently join JSSI’s portfolio of whole aircraft coverage. The company recently added the largest Gulfstream, the G650, along with theGlobal 5000 and 6000, Legacy 650 and Embraer Phenom 100 and 300 business jets. In all, JSSI offers Tip-To-Tail on 165 different aircraft.
The G650 and G280 are a little unusual for JSSI since it is early in the life cycle of the programs, meaning there is less service history and data for JSSI to draw upon as it conducts risk assessments and builds hourly cost programs. But JSSI has worked with Gulfstream operators for nearly 25 years and has a long history with the airframes. And while it may compete against manufacturers’ warranties for the young models, Book has noted that JSSI is able to fill in gaps not covered by warranties.
Book sees growth potential particularly with large fleet operators. He believes JSSI offers an advantage over manufacturers programs for managers of large fleets with different types, since JSSI can accommodate the varied aircraft in the fleets. This eliminates the need for the operators to work with multiple manufacturers to address their fleets, he says.
JSSI also believes it has buying power for customers since it works with nearly all of the major authorized centers and is able to negotiate deals with them. But while being a head-on competitor with the manufacturers, it also has long-standing relationships with them, since JSSI is also their single biggest customer for services, Book says.
The firm recently won its single largest contract for engine and APU coverage from a fleet operator – VistaJet. VistaJet already has close ties with Bombardier, flying an all-Bombardier fleet. But the deal with JSSI covers engines and APUs on 50 Global 5000 and 6000 jets under a 10-year agreement valued at $205 million.
In fact, while the industry contracted over the last five years, JSSI has grown, increasing employment by 50%. This would appear counterintuitive, since JSSI’s revenues are closely tied to flight hours. But he says “as the market collapsed, we began thriving.” As flight hours declined, more customers began seeking more predictability and stability in their costs.
Along with that, JSSI has experienced rapid growth in recent years by expanding into developing markets, Book says. The company has opened offices in Hong Kong, Dubai, Farnborough, Mexico City and Rio de Janeiro, among others, to help build its global client base. In addition to expanding its workforce, JSSI has benefited from the insurance market. Insurers in many of the emerging markets are directing their clients to seek out maintenance programs such as JSSI’s programs, particularly for the engines, Book says.
As far as growth in the markets, JSSI has seen growth in China and the Asia market at large, Russia and the Middle East. India also is starting to emerge, Book adds.
Meanwhile, while takeoffs and landings may be down in Europe, JSSI is seeing growth in flight hours as customers bring in larger equipment and fly longer legs. In fact, European flight hours were up 14% both year over year and quarter over quarter for JSSI, marking a much different story than told through landings and takeoffs. But Book cautions that these improvements come off “some pretty lean years.”
In the U.S., which is still JSSI’s largest market, business is slowly turning around. Growth in larger aircraft has been evident, he says, but he’s seeing more consistency with mid and large cabins too.
All of this sets the stage for a stronger 2014 for operators and continued growth for JSSI, Book says. “We’re excited about 2014. We believe flight hours are going to come back and modest growth will return,” he says. “And we’re really excited about emerging markets.”